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The decision to auction off high tech publishing giant Ziff Communications is expected to draw spirited bidding from players in the U.S., Europe and Japan, with the price likely to hit $2 billion to $3 billion.

But interested players may not need that much cash to participate; Ziff executives say they haven't ruled out selling off the company in three or four pieces.

Potential buyers include U.S. and overseas companies, and run the gamut from traditional publishers to cable TV giants and the Baby Bells. Among the likely prospects: McGraw-Hill, K-III Communications Corp., Reed Elsevier, Capital Cities/ABC, Bertelsmann, United Newspapers, Advance Publications, Dow Jones & Co. and Walt Disney Co.

"It could be anyone from Conde Nast to AT&T," said a Ziff insider. "It has to be someone with pretty significant resources."

It's clear who won't be buying the company.

The family ruled out bids from archrivals International Data Group, Boston, and CMP Publications, Manhasset, N.Y.

The auction is being handled by Steve Rattner, a partner at investment banker Lazard Freres & Co., New York.

Most potential bidders declined to comment; only K-III, Cap Cities and McGraw-Hill admitted to an interest.

When he became chairman emeritus last November, William B. Ziff Jr. made it clear he would be disappointed if his three sons sold the publishing empire his father began. But Mr. Ziff had transferred ownership to his sons in the mid-1980s, when he was seriously ill with prostate cancer, and stressed then the company's future was up to them.

The move is in keeping with a corporate history of divestments when the family thinks the markets have peaked.

Ziff got top dollar in 1984 when it sold and 11 other consumer magazines to CBS for $362.5 million and 12 trade publications to News Corp. for $350 million. Left with a small base of computer magazines, it rode the PC revolution to become the largest U.S. computer magazine publisher.

Ziff last year had 40% of ad revenues among U.S. computer and telecommunications publications, said tracking service Adscope. But Ziff's top titles-PC Magazine, PC Week, Computer , PC/Computing and MacUser-all posted 1993 ad page declines.

Ziff also has a fledgling consumer division and recently launched Computer Life. Other holdings include online services ZiffNet and Interchange, Infor- mation Access Co. and related information businesses, and the Networld+Interop and Seybold computer trade shows.

The early line on some of the potential buyers:

McGraw-Hill: On paper, it looks like a great fit but has been burned by acquisitions before.

K-III: It recently completed a $770 million refinancing with most of the money ($500 million) going to refinance existing debt. Serious players who love this kind of action.

Reed Elsevier: When two European giants merged in January 1993 to form this company, U.S. expansion was an avowed aim. Reed says it has a $1 billion war chest for just such a deal.

Cap Cities/ABC: In late 1992, the company told Wall Street analysts it could swallow a deal of up to $8 billion. So far, it's done nothing. Serious player.

Bertelsmann: The German-based publisher has a tiny consumer publishing interest here, and as one of the world's largest publishers, the company has the financial wherewithal to do the deal.

United Newspapers: The London-based company's San Francisco trade arm, Miller Freeman, has said it's seeking strategic high tech acquisitions.

Advance: The Conde Nast Publications parent pledged $500 million to QVC's unsuccessful effort to buy Paramount Communications.

Dow Jones: It has limited expertise in magazines but may want to buy its way in.

Disney: At the very least, it would be likely to buy out Ziff's stake in Family PC, a joint venture consumer magazine.

Times Mirror Co.: It just sold its cable operations for $2.3 billion but may not part with the cash.

Bradley Johnson contributed to this story.

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